Licence revoked, assets not handed over: the collapse of Union Standard International Group (USGFX)

When the Australian regulator ASIC revoked USGFX's licence in 2020, this was supposed to mark the start of the process of returning money to clients. Instead, the company's parent structure — with an ultimate beneficial owner resident in Myanmar — simply refused to cooperate with the liquidators or to hand over assets. It later emerged just how deep the hole was: according to the appointed liquidators' estimates, creditor claims reached about $357 million, while only roughly $8 million remained actually available for distribution.

Union Standard International Group (the parent structure of the USGFX brand) positioned itself as an Australian forex broker operating under the supervision of ASIC — one of the most highly regarded regulators in the world. A formal ASIC licence created the impression that the company's business was fully transparent and met global standards of client protection.

In reality, the company provided margin-trading services to Chinese clients, in breach of PRC law, which prohibits foreign companies from offering such services to the country's residents directly. On 8 July 2020, Union Standard entered voluntary administration. ASIC first suspended and, on 14 September 2020, finally revoked the company's licence.

On 3 September 2020, by court order, specialists from the firm BRI Ferrier were appointed as the company's liquidators. However, the parent structure, whose ultimate beneficial owner is Myanmar resident Soe Hein Minn, refused to hand over the assets to the liquidators. The liquidators had to engage a private investigator to track down key persons connected to the company abroad — in particular in Myanmar and Taiwan — and the investigation was further complicated by political instability in Myanmar and the COVID-19 pandemic.

Published 2 July 2021